Which of the Following Statements Is FALSE

question 15

Multiple Choice

Which of the following statements is FALSE?

• A)The Capital Asset Pricing Model is the most important method for estimating the cost of capital that is used in practice.
• B)Because the risk that determines expected returns is unsystematic risk,which is measured by beta,the cost of capital for an investment is the expected return available on securities with the same beta.
• C)A common assumption is that the project has the same risk as the firm.
• D)To determine a project's cost of capital we need to estimate its beta.

---

Definitions:

Execute Acts

To carry out, implement, or perform actions or laws as prescribed by a legal or authoritative body.

Nation's Interests

The economic, cultural, and political goals that a country considers important or necessary for its survival and growth.

Constitutional Power

The authority granted to the branches of government by a constitution, outlining the scope and limits of government actions.

Declare War

To declare war is a formal act by which one nation goes to war against another, typically involving a declaration by a country's legislative or executive authority.